Coles reports strong sales growth

  • January 31, 2013
  • Kate Carey

Coles has performed well in the first half of the financial year according to the report by holding group Wesfarmers of the 2013 second quarter results released yesterday.

For the quarter, Coles’ sales were at $9.8 billion, up 5.2 per cent from the previous year-on-year second quarter 2012. Coles’ first half year sales figure of $18.3 billion was also also up 4.7 per cent from the equivalent 2012 financial period.

The positive growth in Coles was expected to put pressure on rival Woolworths, which also performed well in its results released today.

Managing Director Richard Goyder said that Coles December quarter represented the fifteenth consecutive quarter of growth in “comparable sales and sales density.”

Comparable food and liquor store sales in the Coles division increased by 3.9 per cent in the second quarterand 3.8 per cent in the first half. Coles continued to invest in lower prices throughout the quarter, driving volume growth ahead of sales growth. Food and liquor price deflation in the first half was two per cent.

 

New initiatives

Coles Managing Director Ian McLeod said the response to its initiatives had been encouraging, with a commitment to quality, service and value driving customers.

“The underlying performance of liquor improved in the first half as a result of encouraging wine category performance and more effective promotions in the run up to Christmas,” Mr McLeod said of the previously struggling Coles liquor sector.

“We remain committed to improving the experience for our customers throughout Australia. This has been demonstrated by a strong number of new store openings during the quarter, which included three new superstores, and also trials of new store formats,” Mr McLeod added.

Coles opened 10 new supermarkets and closed four stores during the quarter, taking the total number of stores to 753. Coles opened 20 new liquor stores and one hotel and closed five liquor stores during the quarter, taking the total number of liquor stores and hotels to 895.

 

Convenience stores results

Total Coles Express sales, including fuel, for the second quarter were $2.2 billion, up 5.8 per cent on the previous corresponding period. Total sales for the first half increased 4.0 per cent to $4.0 billion.

Fuel volumes increased 4.4 per cent for the quarter and 3.2 per cent in the first half. Comparable fuel volumes increased 3.4 per cent in the second quarter and 2.0 per cent in the first half, reflecting increasing supermarket customer numbers and a strong customer response to fuel promotional campaigns in the half.

Convenience store sales, excluding fuel sales, increased 0.3 per cent for the quarter and 0.1 per cent in the first half.

 

Home Improvement

Total sales for the quarterof $2.2 billion were 6.6 per cent above the previous corresponding period. Total store sales for the quartergrew 6.8 per cent, while store-on-store growth was 4.2 per cent.

For the first halfof the 2013 financial year total sales increased 5.7 per cent to $4.0 billion. Total store sales grew 6.0 per cent in the first half, while store-on-store growth was 3.4 per cent.

Managing Director of Home Improvement John Gillam said the sales performance reflects continued strong levels of customer participation.

 

Office Supplies

Total sales for the quarterwere $350 million, up 0.3 per cent on the previous corresponding period. Good growth in transactions resulted in strong online sales growth for the quarter while store sales were 0.1 per cent above the previous corresponding period.

For the first halfof the 2013 financial year, total sales increased 0.3 per cent to $712 million. Transaction growth for the half was strong and growth in online sales exceeded 10 per cent.

 

KMART

Total sales of $1.4 billion for the quarterwere 3.8 per cent above the previous corresponding period, with comparablestore sales increasing 3.7 per cent. This represented the twelfth consecutive quarter of growth in transactions and units sold.

For the first halfof the 2013 financial year total sales increased 3.5 per cent to $2.4 billion, with comparablestore sales increasing 3.0 per cent.

Kmart Managing Director Guy Russo said the business was particularly pleased with the continued growth in transactions and units sold.

 

TARGET

Total sales of $1.3 billion for the quarterwere 0.6 per cent above the previous corresponding period, with comparablestore sales 0.2 per cent below last year.

For the first half,total sales increased 1.2 per cent to $2.1 billion, with comparablestore sales declining 1.8 per cent. Wesfarmers reported that the sales performance of electrical and entertainment categories continued to be challenging.


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